August 3, 2004



Australian Beef Exports To US Test Quota Limits


Australian beef exports to the United States are running at near record levels, prompting calls from the Federal Government to re-allocate some export quota.


Last week's exports to the US exceeded 13,000 tonnes, the highest figure for the year. Total exports to the US are running only slightly behind the past three years when the 378,214 tonne quota was maximised. The US export beef quota is valued at about $1.7 billion.


The Agriculture Minister, Warren Truss, said it was too early to declare that the quota would be maximised this year. However, a notice had been issued to exporters seeking the voluntary return of unused US quota.


"Any quota returned ... will go to eligible exporters who do not have available quota. It will not be available to those with quota in their account," he said. "A voluntary recall last year freed quota that helped exporters gain access to additional entitlement ... when some were reporting difficulties in obtaining quota."


The US imports lean beef from Australia to make hamburger patties. Dennis Wise, an analyst with Profarmer, said Australian beef competed in the US against US cow beef and lean beef imported from New Zealand. The US market effectively sets the floor to world beef prices, he said.


Mr Wise said prices for lean beef imported into the US were up 43 per cent on last year and were near record levels. This was a result of the sharp fall in the US cow kill.


"Cow slaughter in the US is down 15 per cent for the calendar year to date, representing a reduction of 500,000 cows, or 125,000 tonnes of beef," he said.


Mr Wise added there was a new turn in the seven-to-10-year US cattle cycle. Since 1996, when the US cattle herd peaked at 113 million head, US ranchers had been reducing their herds. But herds were now being expanded again.


"If past cycles are anything to go by, and forage remains favourable, herd rebuilding may last three to five years," he said.


Under the proposed free trade agreement with the US, Australia's beef quota will be increased by 70,000 tonnes over 18 years.

Video >

Follow Us